1Password, a Canadian security and privacy tech startup, raised $100m in a round led by Silicon Valley venture capital firm Accel, valuing the company at $2bn.
While the company was profitable and still flush with cash from its $200m funding round in 2019, this latest round helped to bring in key investors who can help the company grow, including Tobias Lutke, CEO of e-commerce platform Shopify, and Stewart Butterfield, co-founder and CEO of collaboration and messaging app Slack Technologies. Other new investors include Jay Parikh, former vice president of engineering at Facebook Inc.; Gerhard Eschelbeck, former chief information security officer at Google LLC; and Robert Vis, founder and CEO of MessageBird B.V, among others.
The latest investment in the cybersecurity firm comes as the pandemic and remote work have given rise to more hacks and a bigger need to keep companies and consumers safe.
1Password initially started as a consumer app 15 years ago. But five years ago it expanded to serve the fast-growing corporate market, where companies face increasing challenges.
Founded in 2005, 1Password offers password management to businesses and consumers. The company’s software allows users to create passwords and auto-fill logins for sites and applications, negating the need to remember passwords for each site. It does so while offering a secure vault with AES 256-bit encryption to secure user information.
The company also offers the ability for customers to store files and other sensitive data through secure vaults. In April, 1Password moved into infrastructure security with a service that helps enterprises protect secrets such as encryption keys. Secrets Automation focuses on “secrets,” small files that organizations’ backend applications use to secure the data they work with. The service provides a centralized interface that allows administrators to maintain their companies’ website security certificates, API tokens and other cybersecurity-related files such as encryption keys in one place.
The company now has more than 90,000 business customers and has crossed $120 million in annual recurring revenue. Notable customers include IBM, Wealthsimple, PGA, Under Armour, Intercom, Slack Inc., PagerDuty Inc. and GitLab Inc.
Arun Matthew, a partner at Accel, which led the funding in 2019, said Accel approached 1Password to raise more funds as the firm sees a huge opportunity in the space. He said Accel, which was an early investor in Facebook Inc, has 24 cybersecurity investments.
“We see this as courage capital,” said Matthew, noting that having a lot of cash on hand can help 1Password pursue bigger opportunities, including acquisitions.
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